Opinion of the Economic and Social Committee on the "Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 2027/97 on air carrier liability in the event of accidents"
Official Journal C 123 , 25/04/2001 P. 0047 - 0050
Opinion of the Economic and Social Committee on the "Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 2027/97 on air carrier liability in the event of accidents" (2001/C 123/09) On 23 June 2000 the Council decided to consult the Economic and Social Committee, under Article 80(2) of the Treaty establishing the European Community, on the above-mentioned proposal. The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 9 January 2001. The rapporteur was Mr Green. At its 378th plenary session of 24 and 25 January 2001 (meeting of 24 January 2001) the Committee adopted the following opinion by 79 votes, with one abstention. 1. Background 1.1. Regulation (EC) No 2027/97(1) introduced a modern liability regime for European Community airlines in the event of death or injury of their passengers and guaranteed a uniform regime for European Community airlines pending the ongoing review of the 1929 Warsaw Convention with subsequent amendments. In 1996 the Economic and Social Committee adopted an opinion in support of the Commission's proposal for a regulation(2). However, that regulation did not cover a number of matters, particularly those relating to baggage and delays, which are now addressed in the current proposal amending Regulation (EC) No 2027/97. 1.2. The Warsaw Convention(3) was a significant landmark in the history of international aviation; above all, it regulated the relationship between air carriers and passengers in the event of accidents occurring during international carriage by air. Normally the burden of proof lies with the claimant but the Warsaw Convention reversed this procedure. In order to alleviate the impact of this innovation, air carrier liability was limited unless the claimant could prove gross negligence. 1.3. Since 1929 the Convention has been amended and supplemented by a number of agreements, the most important being the Hague Protocol (1955), the Guadalajara Convention (1961), the Guatemala Protocol (1971) and the Montreal Protocols (1975). Though the Warsaw Convention has entered into force in over 140 countries, not all the subsequent agreements have taken effect, sometimes because there has been an insufficient number of ratifications and, in other cases, because the groups of signatory countries vary. However, in the case of the Montreal Protocols, only Protocol No 3 has not yet taken effect. At present seven possible international legislative regimes exist. 1.3.1. Air transport legislation is therefore complicated by the fact that some countries have only signed the Warsaw Convention (1929) while others have also acceded to one or more of the later conventions, agreements or protocols. If maximum air carrier liability under the Warsaw Convention is indexed at 100, the Hague Protocol (1955) increases this limit to 200, Guatemala (1971) to 1200, and the Montreal Protocol No 3 (1975) to 973 - the same ceiling as in the recent Montreal Convention (1999), namely 100000 SDR(4) per passenger, with the proviso that air carriers may not refuse or limit liability for damage arising in the specific circumstances described in the Convention. The consumer price index for the relevant period in the industrialised countries reached an index of approx. 900 in the mid-70s. 1.3.2. Expressed in euros, the air carrier liability limit under the Warsaw Convention (1929) is approx. EUR 15000; the Montreal Convention (1999) provides for minimum liability of just under EUR 150000. 1.4. Speedy ratification by the Member States of the Montreal Convention of 28 May 1999 on the unification of certain rules for international carriage by air(5), in conjunction with the proposed amendment of Regulation (EC) No 2027/97, will facilitate the rapid entry into force of the Montreal Convention (30 States must ratify) and in particular facilitate the updating and harmonisation of the European Community rules on air carrier liability for compensation in the event of a passenger's death or injury. The impact will in the short term be to unify the rules concerning Community air carriers and passengers on both domestic and intra-Community flights, and ultimately, as a result of competition, to help achieve a substantial improvement for passengers travelling between EU and non-EU countries on airlines which are not established in the Community. 1.4.1. This approach is consistent with Treaty Article 307 and can assist Member States in taking a common position where necessary. It is also in line with Article 55 of the Montreal Convention (1999), which specifies that the Convention takes precedence over other provisions (Warsaw Convention, etc.). 1.5. The Montreal Convention (1999) reflects the insurance principle which has generally gained increasing ground in the EU in transport matters, namely that the party with direct responsibility for safety shall also bear direct economic responsibility for any inadequacies in that respect. 2. The Commission proposal 2.1. The Montreal Convention establishes a modernised and uniform legal framework to govern the liability of airlines for damage to passengers, baggage and cargo incurred during international journeys. 2.2. The Montreal Convention and Regulation (EC) No 2027/97 provide for the same basic system of liability for death or injury of passengers. Adoption of the Montreal Convention provisions inside the Community will therefore not have adverse effects for European standards. At a detailed level, however, a revision of the Community rules is needed in order to make the following changes: 2.2.1. Inclusion of a reference to the Montreal Convention in addition to the existing reference to the Warsaw Convention so that the new Convention becomes a point of reference and the Regulation keeps pace with developments. 2.2.2. Exact alignment of the provisions on liability, exoneration and compensation in case of death or injury on the texts of the equivalent provisions in the Montreal Convention so that the regime applicable to Community carriers is the same, regardless of whether the route flown is international, intra-Community or domestic. 2.2.3. Updating of the provision on advance compensatory payments and the amount payable upon death of a passenger. 2.2.4. Improvement and simplification of the provisions on passenger information in order to focus on areas of real interest to passengers. 2.2.5. A particular innovation in the proposed amendment to Regulation (EC) No 2027/97 is the introduction of a uniform regime for all forms of liability towards passengers and their belongings on all flights, including liability for baggage and for loss occasioned by delay, which is provided for in the Montreal Convention but hitherto not in Regulation (EC) No 2027/97. 3. General comments 3.1. Regulation (EC) No 2027/97 and the proposed amendment thereto differ in several respects from the Warsaw regime in that the Regulation draws a distinction between EU air carriers and carriers established outside the EU. On the other hand, the Warsaw regime makes an operational distinction between national and international carriage by air. As the Community is not part of the Warsaw regime, Regulation (EC) No 2027/97 and the proposed amendment thereto cannot conflict with the Community's international obligations. 3.1.1. In a case brought by IATA(6) before the High Court of Justice in England, although the judge found that the Regulation created conflicts for Member States in relation to their prior obligations to other Warsaw Treaty States, he declined to refer the matter to the European Court of Justice. 3.1.2. In addition, it is far from certain that any clash arises between the Warsaw regime and the Regulation since none of the countries which have undersigned the Warsaw provisions have taken any action in this respect. 3.1.3. Even if such a conflict could be established, that does not as such render Regulation (EC) No 2027/97 invalid. Should ratification of the Montreal Convention not be imminent, the Member States could on the other hand be forced to renounce their Warsaw Convention undertakings, but only where such a conflict could be established following the demand of a country which has ratified the Warsaw Convention. 3.1.4. Except in the United Kingdom, the High Court decision therefore has no legal force in the other 14 Member States. The decision can create de facto uncertainty only perhaps in the United Kingdom. However, as far as EU air carriers and citizens are concerned, there seems to be no grounds for non-implementation of the Regulation, since its rules on liability do not apply to air carriers which are not established in the Community. Non-EU carriers are only bound by the requirement to inform passengers, which does not seem incompatible with the Warsaw Convention. 3.1.5. In the light of the above considerations, the ESC endorses the Commission's viewpoint. 3.2. Implementation of the proposed amendment to Regulation (EC) No 2027/97 will give passengers a greater degree of certainty about their rights and ensure that the Community regime fits seamlessly with the new global rules provided for in the Montreal Convention. 3.3. The ESC calls for international pressure to be brought to bear so that the Montreal Convention (1999) can take effect speedily; to this end, the Member States should ratify the Convention as soon as possible. However, it must be borne in mind that the Warsaw Convention provisions will continue to operate for a time in tandem with the Montreal Convention as regards flights between the EU and third countries. 3.4. The ESC agrees with the Commission that the revised Regulation should enter into force on the earliest date compatible with the Community legislative process and the necessary adjustments by the industry. 3.5. Should that date be prior to the entry into force of the Montreal Convention, some confusion could arise as to the obligations of Community carriers. The ESC therefore advocates that efforts be made to ensure simultaneity as far as is feasible. 4. Specific comments 4.1. Article 2(c) The ESC welcomes the proposed rewording of this text, which provides greater clarity. 4.2. Article 2(f) The ESC takes the view that the relevant Montreal additional protocols should be incorporated into the proposed amendment to Article 2(f) since, in the case of their signatory countries, these instruments update the original and the revised Warsaw Convention. 4.3. Article 3(2) Though the proposed clarification regarding air carriers' obligation of insurance pursuant to Article 7 of Regulation (EC) No 2407/92(7) is consistent with Article 50 of the Montreal Convention (1999), the ESC recommends that this obligation should be spelled out more clearly in the Community context, on practical insurance grounds. 4.4. Article 5(3) The ESC would point out that, as a consequence of the proposed deletion of Article 3(3), the reference to this clause in Article 5(3) of Regulation (EC) No 2027/97 should be amended accordingly. 4.5. Article 6 In the ESC's view, all air carriers in the Community must be required to provide written notice in simple and easily understood terms, specifying their legal obligations in respect of liability. 4.6. Article 7 (of Regulation (EC) No 2027/97) In the ESC's view, the deadline by which the Commission is to draw up its report should be fixed so as to allow use of the report's conclusions by the deadlines indicated in Article 24 of the Montreal Convention concerning the review of liability limits. 4.7. However, in the ESC's view, the liability ceiling of 1000 SDR for loss, damage or delay of luggage is too low. It would seem unrealistic for ordinary passengers to be expected to make a special declaration of interest in delivery of their baggage at destination. Nonetheless, the ESC does understand that the proposed amendment of Regulation (EC) No 2027/97, on this point alone, duplicates the corresponding provision in the Montreal Convention. 5. Conclusion Subject to the above comments, the Economic and Social Committee supports the Commission proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 2027/97 on air carrier liability in the event of accidents (COM(2000) 340 final). It also urges the Member States to ratify the 1999 Montreal Convention as speedily as possible. Brussels, 24 January 2001. The President of the Economic and Social Committee Göke Frerichs (1) OJ 1997 L 285, p. 1-3. (2) OJ 1996, C 212, p. 38-40. (3) For details of the Warsaw Convention with subsequent amendments etc., see Article 55 of Annex A to the Proposal for a Council Decision on the approval by the European Communities of the Convention for the Unification of Certain Rules for International Carriage by Air (the Montreal Convention) COM(2000)446 final of 14.7.2000. (4) The Special Drawing Right or SDR is an international currency unit defined by the International Monetary Fund. 1 SDR = EUR 1,44 as of 26.4.2000. (5) For details of the Warsaw Convention with subsequent amendments etc., see Article 55 of Annex A to the Proposal for a Council Decision on the approval by the European Communities of the Convention for the Unification of Certain Rules for International Carriage by Air (the Montreal Convention) COM(2000)446 final of 14.7.2000. (6) IATA has just under 240 general members, of which as many as 30 are established in the Community. (7) OJ 1992 L 240, p. 1-7.